Prime retail space remains elusive in Saskatoon

One of my biggest challenges is finding the right fit for tenants. In a commercial landscape that remains under-serviced for retail, that’s not exactly my fault.

Kelly Macsymic, ICR Commercial, Saskatoon.

We did see some new construction of retail in 2018, so it’s probably time to re-evaluate where the inventory levels sit versus vacancy, midway to the end of the third quarter of 2018.

Looking at the numbers by area, who do you ask: landlords or tenants?

In a landlord’s universe, all they can hope for is that their commercial real estate is ideally situated for the long haul.

Saskatoon’s golden mile, 8th Street, continues to hold its position as one of the busiest retail corridors in the city. Vacancy on 8th Street went down in the last quarter to 3.6 per cent.

That doesn’t leave many options for businesses which want a place in the centre of that retail action. There is only a reported 36,677 square feet of total vacancy and rates are staying steady at an average of $26.89 per square foot.

For tenants this leaves fewer options.

East side retail

University Heights currently boasts a 3.5 per cent vacancy rate, with only 40,000 square feet of total inventory vacant.

Stonebridge is a little higher at 6.1 per cent, but that is partly due to the new construction at Cory Common on Preston Avenue South.

The average asking rate in University Heights is $25.27 per square foot, while Stonebridge tenants are looking at an average of $32.83 per square foot.

Perception vs. reality

Downtown is an area about which I often get questions regarding vacancy. It’s important to understand that we separate the office and retail inventories rather intentionally.

As well, City of Saskatoon bylaws are designed to promote retail activity only on main floor access. There are only a few exceptions to this, such as Midtown Plaza.

Downtown vacancy is 4.3 per cent, which is very healthy. Asking rates are attractive at $23.69 per square foot.

Good luck finding space here

The lowest vacancy reported at the end of the second quarter was Broadway. That’s not surprising, as this finite neighbourhood has always seemed full.

At 1.1 per cent vacancy, it was reported that inventory was sitting at only 3,200 square feet. The number could have shifted slightly since that finding, but I’m sure it’s not far off.

Asking rates average are at a comfortable $22 per square foot on Broadway.

Saskatoon’s worst area for vacancy

There really isn’t any! Well, that’s not entirely true.

Over the years we’ve added to and amended the areas for which we collect retail data.

We consider 51st Street (2.1 per cent vacancy) and Circle Drive (6.5 per cent) to be retail corridors now.

As well, I am not intentionally leaving off west side retail. Confederation vacancy is very low at 2.9 per cent and even 20th/22nd streets are only six per cent vacant.

Sutherland has always held its own and there is a six per cent vacancy there as well.

The greatest vacancy is defined by two very distinct transitional areas; the Idylwyd Drive retail zone and 33rd Street retail corridor.

We will see further changes as Idylwyld Drive moves away from residential fronting property to commercial, and the area’s 14.3 per cent vacancy is an indication of that. 33rd Street is also continuing to find its audience, with an overall vacancy of 15.3 per cent.

Expect that our upcoming third-quarter reports will include the newest data within Blairmore and Kensington. Blairmore currently has little to no vacancy and Kensington is in construction mode.